Bombay High Court
Dbs Financial Service (Pvt.) Ltd. And ... vs Maharashtra General Kamgar Union And ... on 21 July, 1995
Equivalent citations: [1996(73)FLR1492], (1996)ILLJ1160BOM
Author: B.N. Srikrishna
Bench: B.N. Srikrishna
JUDGMENT B.N. Srikrishna, J.
1. This writ petition under Articles 226 and 227 of the Constitution of India impugns an interlocutory order of the Industrial Court, Bombay, dated October 21, 1993 made .in complaint (ULP) No. 1176 of 1990 under the provisions of Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971 (hereinafter referred to as "the Act").
2. The First Petitioner is a private limited; company, which was previously known as "Diners Club India Ltd." and used to carry on the business of credit cards. The other Petitioners are Directors of the First Petitioners-Company. The First Respondent is registered trade union representing the erstwhile workmen of the First Petitioner.
3. Some time in the year 1990, finding that their finances were unable to support the rapidly increasing credit card business, the Petitioner started negotiations with Citibank for selling their credit card business to them. Though it was intended that the credit card business would be ultimately taken over by Citibank, the Petitioners were anxious to recover large amounts of money from their customers due because of credit already extended on credit cards. With this background, the Petitioners entered into a Settlement dated March 16, 1990 with the First Respondent, in which it was agreed, inter alia as under:-
"Due to intense competition particularly in the credit card business due to introduction of credit card by banks, Diners Club (India) Private Limited might find it necessary to re-organise, restructure and/or transfer its credit card operations The Union and the workmen will give full Co-operation to the management. No workman of Diners Club (India) Private Limited will however be retrenched from the service as a result of this transfer and the services of all the workmen of Diners Club (India) Private Limited, will be absorbed in other activities in Diners premises in Bombay with the same service conditions, without affecting them adversely in any manner."
Pursuant to the said settlement, the Petitioners sought to transfer some of their workmen from their office at Diners House. Fort, Bombay, to their office at Raheja Chambers, Nariman Point, Bombay. In view of the anticipated shrinkage of their business, the Petitioners were desirous that the workmen be conveniently relocated in Raheja Chambers, where some portion of the premises was also occupied by an associate concern of the First Petitioners, known as "DBS corporate Services Pvt. Ltd."
4. The Workmen, however, objected to such transfer and moved Complaint (ULP) No. 730 of 1990 before the Industrial Court at Bombay. On their application, the Industrial Court on July 12, 1992 granted an ad-interim order restraining the transfer of the workmen from the Diners House premises to the premises at Raheja Chambers, Nariman Point. This ad-interim order came to be subsequently vacated on October 21, 1993, after hearing the Petitioners. In the interregnum, however, the ad-interim order continued to operate. Having failed in their attempt to relocate the employees at Raheja Chambers the first Petitioner offered another alternative to the workmen. It suggested that as the business was going to be drastically curtailed the workmen would be provided alternative work with its associate companies under arrangement with the associate companies that the workmen would continue to be in the employment of the Petitioners even while such work was bing carried out on the premises of the associate companies for the as sociate companies. This offer was also spumed by the workmen. The First Petitioner issued letters to the workmen to enforce this decision. The First respondent promptly filed complaint (ULP) No. 1085 of 1990 before the Industrial Court, Bombay. The Industrial Court readily granted an ad-interim order restraining the Petitioners from implementing the aforesaid decision. This ad-interim order also-remained in operation from October 8, 1990 to October 21,. 1993 on which date it came to be confirmed.
5. Having been stymied by the two ad-interim orders, which made it impossible for the Petitioners to carry on their business in any rational or reasonable manner, the Petitioners decided to close down the business itself and terminate the services of all the workmen concerned. On October 18, 1990, the petitioners put up a notice of closure closing down their industrial establishment and simultaneously terminated the services of the workmen employed in the establishment at DBI House (formerly known as "Diners House"), Marzban Road, Fort, Bombay 400 001 and at Raheja Chambers, Nariman Point, Bombay 400 021. The reason for closure stated in the notice was "financial and economic reason". The notice offered compensation payable in law to the workmen upon closure, apart from other terminal benefits to which they were entitled. On October 29, 1990 the First Respondents filed complaint (ULP) No. 1176 of 1990 and again obtained an ad-interim order from the Industrial Court. Interestingly, in paragraph 3(h) of the said Complaint, it was averred by the First Respondent:
".... The complainant further states that the business which was carried on for last more than 30 years by these employees was of 100% which has been transferred to respondent No.6 company and finalisation has been going on in respect of this transfer. There is no work available to these employees. The respondent has no alternative work to provide these employees and therefore the respondent has to pay wages and protect the interest of these employees as per Clause (6) of the settlement dated March 16, 1990."
It was further averred in the Compliant that, though the closure had taken place and the services of the workmen had been effectively terminated with effect from October 18, 1990, the closure was contrary to the provisions of Section 25-O of the Industrial Disputes Act, 1947, as the establishment of the Petitioners was covered under Chapter VB of the said Act. It was also alleged that the closure was mala fide and intended to victimise the workmen for their active association with the First Respondent Union. On these averments, the Industrial Court granted ad-interim reliefs in terms of prayers 3(e), (f), (g) (h) and (i) in the following terms:
"3 (e) THAT pending the hearing and final disposal of this application, the Respondent, its agents, servants and officers to be restrained from transferring any further business yet to be transferred to Respondent No. 6;
(f) THAT pending the hearing and final disposal of this application, the Respondent, its agents, servants and officers to be restrained from recruiting any of the employees on whatsoever basis and whatsoever nature;
(g) THAT pending the hearing and final disposal of this application, the Respondents , its agents, servants and officers to be restrained from installing any new computers, equipments, articles and accessories.
(h) THAT pending the hearing and final disposal of this application, the Respondent, its agents, servants and officers to be restrained from alienating, transferring parting with, disposing off the premises, furniture, computers, accessories, files, records etc., in its premises at Raheja Chambers and Diners House;
(i) THAT pending the hearing and final disposal of this application, the Respondent, its agents, servants and officers to be restrained from demolishing office cabins, interiors and restructuring or remodelling or redesigning office premises situated at Raheja Chambers and Diners House."
The application for interim relief was subsequently heard and ad-interim reliefs in terms of prayer 3(f) and 3(g) were confirmed by the impugned Order dated October 21,1993, while the ad-interim order in terms of prayer 3(h) was modified in the following terms:
"3 (h) THAT pending the hearing and final disposal of this application, the respondents, its agents, servants and officers to be restrained from alienating, transferring, parting with, disposing off the premises, at. Raheja Chambers and Diners House."
Being aggrieved by the aforesaid interim order dated October 21, 1993 the petitioners are before this Court to impugn the said order.
6. A reading of the impugned order (which runs into about 55 pages) would show that the real reasoning, if one may call it so, is contained only in paragraphs 15, 16 and 17 of the order. The rest of the order is a liberal reproduction of the pleadings and head-notes from judgments cited at the bar.
7. A perusal of the ad-interim order granted, by the Industrial Court on October 21, 1993 in' Complaint (ULP) No. 1176 of 1990 shows that the learned Advocate, who appeared for the petitioners, had prayed for some time to enable him to go through the Complaint, the interim application and thereafter to make submissions. He had also pointed out that, since the establishment of the Company was closed, no purpose would be served by passing any ad-intenm order at that stage, as there was no urgency in the matter and that at the most, a status quo order might be granted. The learned Judge of the Industrial Court, however, was of the view that, in view of the apprehension of the workmen and in view of the agreement, he felt that it was necessary to grant ad- interim reliefs in terms of prayer Clauses (e) (f), (g) (h) and (i) of paragraph 3.
8. Learned Counsel on both sides have taken me through the impugned order. I particularly called upon Shri Ganguli, learned Advocate appearing for Respondent No. 1 to show the application of mind to the basic principles to be kept in mind while granting any interim order in the complaint. It appears that the judgment of this Court in Dalai Engineering Pvt. Ltd v, Ramrao Bhaurao Sawant and Ors. 1991 II CLR 808 was cited before the learned Judge during the course of arguments on the application for interim reliefs. There is express reference to this case. Though the learned Judge has reproduced head-notes II and III of the said judgment, it is the observations in paragraphs 11 to 15 which really set out the principles to be followed while granting an interim or ad-interim order in exercise of power under Section 30(2) of the Act. Apparently, there was no advertence of mind to these principles by the learned Judge, if one were to go by the irrelevant head notes reproduced in the judgment. Apart therefrom, in the order itself the learned Judge of the Industrial Court raised a number of issues which arose in the case and, they were, "(i) Whether the First Petitioner was a commercial establishment?
(ii) Whether the closure was illegal or it was a lock-out under the guise of a closure or whether it was a retrenchment?
(iii) Whether the Respondents had engaged in an unfair labour practice under Item 9 of Schedule IV of the Act by not implementing the settlement?
(iv) Whether the First Petitioner had terminated the Services of the workmen in addition to the right of closure?"
Without answering any of these issues, even prima facie, it was impossible to grant any interim relief. Surprisingly, after having raised the relevant Issues which arose in the case the learned Judge observed that, while deciding the application for interim relief, he did not think it proper to consider all the points mentioned above and, therefore, raised only three issues, the first of which was -- "Whether the complainant has a strong prima-facie case and balance of convenience?" (Vide paragraph 8 of the impugned order). It is unfortunate that, apart from the cryptic observation in paragraph 15, there is no finding made anywhere -- not even prima facie -- as to whether there was a case of unfair labour practice made out in the complaint. Without arriving at even a prima facie finding as to the case of unfair labour practice made out in the complaint, the learned Judge straightaway decided that it was necessary to grant interim, relief. He also observed that the petitioners had definitely transferred the concerned workmen from one establishment to another against the law and thus indulged in an unfair labour practice" and therefore in his opinion, the First Respondent had a strong prima facie case and balance of convenience was in its favour. I am unable to make out from the impugned order as to whether the learned Judge adverted his mind to the fact that the establishment had already been closed on October 18, 1990, a good 11 days before the Complaint was filed and the application for ad-interim relief was moved. The observation in paragraph 17 of the impugned order: "During the pendency of the case the establishment has been closed and the retrenchment compensation had been paid to the workmen" , belies such a supposition on my part. Apparently, the learned Judge erred in assuming that the closure had taken place during the pendency of the Complaint. It does not appear to have been noticed by the learned Judge that the issue before him was "Whether the closure, which had already taken place (as admitted in paragraph 3(h)) was illegal or not, and "whether the termination of services of the concerned workmen (as admitted in paragraph 3(h)) was illegal or not?" It is unfortunate that, without careful application of mind to the relevant issues, at least for the purpose of expressing a prima facie opinion, the learned Judge straightaway confirmed the ad-interim order and passed an order which in no way does justice to either party. I am, therefore, of the view that the Order impugned in this Writ Petition is manifestly unjust, erroneous and needs to be interfered with. Though this Court reluctant to interfere with interlocutory orders in Writ Jurisdiction, this is an exceptional case where the interests of justice demand such interference.
9. In the result, the Petition is allowed. Rule is made absolute. The impugned Order dated October 21, 1993 made in complaint (ULP) No. 1176 of 1990 is hereby quashed and set aside.
10. The learned Advocates on both sides state that the Complaint itself is ready for trial. If that be so, it is expected that the Industrial Court shall expeditiously dispose of the complaint itself.
11. Since this Writ Petition has been entertained only against an interlocutory order, any observations made in this judgment are not final conclusions and the Industrial Court need not feel inhibited by them while deciding the Complaint on merits.
12. Certified Copy expedited.